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Strategies & Market Trends : VOLTAIRE'S PORCH-MODERATED -- Ignore unavailable to you. Want to Upgrade?

To: Dealer who wrote (42494)	9/24/2001 8:15:28 AM
From: Dealer	Read Replies (2) \| Respond to of 65232

Europe Markets European markets bounce Brent crude falls to $22.81; Autos, banks lead rebound By Ivar M Simensen, FTMarketWatch Last Update: 7:22 AM ET Sep 24, 2001 LONDON (FTMW) - Europe's main stock markets rebounded on Monday after the blue-chip indices hit four-year lows late last week. Gains in carmakers, financial and oil stocks sent the benchmark indices sharply higher in morning trade, but the rally eased some by early afternoon. Frankfurt's DAX 30 (1876534) was 3.6 percent higher while in Paris, the CAC 40 (1804546) added 3 percent. London's FTSE 100 (1805550) rose 2 percent. On the new markets, the Neuer Markt 50 (1809455) added 2.8 percent and the FTSE TechMARK (1859502) rose 2.7 percent. Although the percentage gains look significant, European indices have taken back only a fraction of the losses since the U.S. terror attacks. London, Paris and Frankfurt have lost roughly 12, 17 and 20 percent respectively in the last two weeks. "Friday was a capitulation. The market was very oversold there was evidence that everything was being thrown in, stories of insurance companies having to sell." John Hatherley, head of global analysis at M&G fund management, said. "There is now room for some form of technical bounce. We may see markets taken lower again next week, it will depend on the newsflow, but for the first time in a long while there is real value in the market," he added. Last week the Dow Jones (DJIA) fell 14.3 percent, its biggest weekly decline since the Great Depression in 1933. See U.S. markets report. The U.S. markets are also set to take back some of last week's heavy declines with the Dow Jones seen opening 140 points stronger, according to spread-betting service IG Index. The Nasdaq (COMP) is expected to start off 28 points higher. But gains could prove short-lived, as many analysts now expect the U.S. economy to fall into a broad recession, with more profit warnings and job losses to come in the next couple of weeks. See U.S. markets preview. In Asia, markets in Hong Kong and Seoul rebounded slightly while Tokyo was closed for a public holiday. The main indices in Taiwan and Singapore were lower. See Asia markets report. The FTSE Eurotop 100 (1883619) rose 3 percent, led higher by a bounce in the technology and auto sectors. Nokia (NOK) (000053994) and SAP (716460) (SAP) both rose about 5 percent. See European indices at a glance. German chipmaker Infineon (623100) (IFX) led decliners, dropping 10 percent on reports of falling DRAM (dynamic random access memory) prices. Deutsche Bank buys Scudder Deutsche Bank (804010) announced it's buying Scudder, the fund management arm of Zurich Financial (ZURN), for $2.5 billion. Shares of Deutsche Bank were 6.5 percent higher and Zurich Financial shares rose as much as 10 percent. See more on Deutsche-Zurich deal. UK insurer Prudential (PRU) added 9 percent. See London markets report. While Spanish banks Banco Santander (STD) and Banco Bilbao (BBV) rose 7 percent, taking Madrid's Ibex 35 nearly 4 percent higher. French aerospace group EADS (005730) added 4.3 percent coming off a 9 percent gain from the morning, after being one of the hardest hit stocks in the wake of the attacks on the U.S. Carmakers also rose after the sector has been hit hard by fears of weakening consumer confidence in the U.S. DaimlerChrysler (710000) (DCX) added 8 percent and Volkswagen (766400) rose 6.5 percent. The DJ STOXX auto index was 5.6 percent higher. Oil stocks gain despite crude sell-off The oil majors rose, despite crude prices heading sharply lower. November Brent crude fell $2.77 cents to $22.81 by midday trade in London. Oil stocks shaved gains, but remained in positive territory. Shell Transport & Trading (SHEL) (SC) rose 4.5 percent and Royal Dutch Petroleum (00947) (RD) added 5 percent after the stocks were hit hard last week after it cut its future production growth targets. BP (BP) (BP) rose 1 percent while France's TotalFina Elf (012027) was nearly 2 percent stronger. Airlines recover British Airways (BAY) (BAB) was reportedly considering a £2 billion sale and leaseback of its property portfolio as a way of cutting debt and increasing its cash reserves, according to British media reports. See more on BA. BA shares took back 7 percent and other airlines also bounced. Germany's Lufthansa (823212) surged 10 percent before coming back to trade 3.5 percent higher by early afternoon. Air France (003112) jumped 5.7 percent and Swissair surged as much as 25 percent after announcing a major business restructuring. See more on Swissair restructuring, airline rebound. After the markets closed on Friday. French insurer AXA (012062) (AXA) said its loss from the terror attacks in the U.S. would be about $550 million, revised from $300-400 million earlier. See more on AXA. AXA shares rose 5 percent. Luxury goods group LVMH Moet Hennessy (012101) added 6 percent after its deal with rival PPR (012148) for the control of Gucci (35500) (GUC) received backing from the Dutch securities regulators late on Friday. Shares of Italian fashion house Gucci surged 22 percent at the open in Amsterdam and remained nearly 20 percent up in lunchtime trade. See more on LVMH-PPR-Gucci deal. BT hurdles build One of the few notable decliners was British Telecom (BTA) (BTY). The stock fell nearly 5 percent after the troubled telecom operator said it is to take a £500 million charge in its interim results as costs of its Concert joint venture with AT&T (T) mounted. See more on BT. On edge But the biggest questions remain where, when and how U.S. President George W Bush will retaliate against the people who attacked New York and Washington nearly two weeks ago. With U.S. and British forces in the Persian Gulf and around Afghanistan poised for action, markets are on tenterhooks for the impact of any retaliation on already gloomy economic sentiment. See preview of this week's European markets. "Last week there was a feeling of huge uncertainty on the military and economic situation. This week you may get some clarification, when people can quantify the risks there is potential for the rally to continue," M&G's Hatherley said.